Covid-19 Policies Promote Shift In Global Growth Poles

Covid-19 has been raging for more than two years since January 2020,which has brought a heavy blow to the global economy.Different Covid-19 policies utilized in different countries are reshaping the pattern of world economic growth and prompting a world growth pole shift.Some countries have stabilized,strengthened,and(re)gained the status of world growth poles with appropriate Covid-19 policies,while others have weakened and lost their status as world growth poles due to inappropriate Covid-19 policies.This study is guided by the growth pole theory,international trade theory,and economic growth model.This study improves the measurement of growth poles’ polarities with data of four dimensions: trade,finance,labor(migrant),and technology transformation.The polarities of each country in 2019 and 2020 are calculated using principal component analysis(PCA).The data of Covid-19 policies was provided by the CoronaNet database,and are dimensioned into three attributes: strictness,flexibility,and timeliness.After all that,the regression model is used to analyze the impact of the Covid-19 policy on the growth polarity shift in 2019-2020.The main findings are as followed:(1).Strictness and flexibility of Covid-19 policies ultimately affects the polarity of growth by affecting international trade.The effect of strictness is "U"-shaped,that is,when the strictness is very high or very low,there is a larger positive effect,and when the strictness is medium,the positive effect is minimal.(2).The effect of flexibility on the growth polarity depends on the strictness,When strictness is high,higher flexibility has a greater positive effect on growth polarity,and when strictness is low,less flexibility has a greater positive effect on growth polarity.(3).The timeliness of Covid-19 policies has a significant positive impact on growth polarity through international finance and technology transfer,but this effect is no longer significant after the control variable of per capita wealth is brought into the model,which implies the positive impact of timeliness can be explained by per capita wealth.(4).EU membership has a positive impact on growth polarity,which comes from the generally better timeliness of Covid-19 policies.NAFTA membership has a negative impact on growth polarity.(5).Before the outbreak of the Covid-19,the global growth poles were mainly the United States,China,and other developing countries,and the concentration of growth poles was low;one year after the outbreak,the global growth poles shifted to be the United States,China,and Europe,and the concentration has increased.Countries using strict Covid-19 policies represented by China have achieved success,while countries using loose and flexible Covid-19 policies represented by Switzerland and Germany have also achieved success.(6).On average,the Covid-19 policies of developed countries are time-sensitive,while those of developing countries are lack of,which makes Western Europe replace emerging countries such as India,Russia,and Mexico as the world’s growth polesPolicy recommendations are given based on all the above: the government should try to improve the timeliness of Covid-19 policies and should maintain a strict,rigid policy or a loose,flexible policy,in order to benefit the economy based on the perspective of the growth pole.